Debt Ceiling Logic?

There has been tons written on the debt ceiling debate and what I fail to understand is how borrowing more money makes the country more financially sound. Hank I-Have-A-Bazooka-in-my-Pants Paulson comes out with another threat here:
And the sense of urgency is clear – failing to raise the debt ceiling would do irreparable harm to our credit standing, would undermine our ability to lead on global economic issues and would damage our economy.
I'm but a simple financial software guy so I don't understand; how could putting more money on one's credit card result in better credit? And according to this Santelli conversation we're about $160 billion short if the ceiling isn't raised RIGHT NOW. So we raise the ceiling, add to the debt and the next time around wouldn't that number likely be higher causing us to raise the ceiling, and so on and so forth until what?

And how does that translate into good credit ratings from Moody's, Fitch and S&P? Aren't they the same folks that brought us the AAA CDO's that were actually worth 0.00000 anyway?

I work in a world of 1's and 0's. I deal with pure logic and I cannot for the life of me understand the "logic" that we are being presented by our leaders. Santelli's logic makes perfect sense to me though.

1 comment:

Mark S. said...

You asked (and I paraphrase) raise the debt ceiling again and again until what...?

I'll tell you what. Until all the money (sorry, I mean currency)dies and goes to money heaven of course.

You're welcome.

Happy Super Tuesday!